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2 1978


Chapter 2

Registered Land

Priority of charges in favour of Corporation.

[cf. 1947, s. 39; 1973, s. 4.]

39. —(1) Where a charge in favour of the Corporation for the repayment of a loan is registered as a burden affecting registered land, then, subject to subsection (2) and (3), the charge (including interest and the costs and expenses of all legal proceedings instituted by the Corporation for the purpose of realising the amount at any time owing on foot of the charge) shall as against the land be in priority to and shall override any equitable claim against the land.

(2) Where—

(a) at the date of an instrument creating a charge on registered land which, but for this subsection, would on registration be a priority charge, a caution to which section 97 of the Act of 1964 applies appears on the register as affecting the land, and

(b) the caution was lodged by a person claiming to be entitled to an equitable claim against the land, and

(c) that equitable claim is at any time after the registration of the charge registered as an estate or interest in or burden on the land,

then, notwithstanding subsection (1), the relative priorities of the charge and the equitable claim shall, unless that person agrees to the contrary, be determined as if subsection (1) had not been enacted.

(3) Subsection (1) shall not operate in respect of any charge the effect of which is to make the land subject to the repayment of a total amount of outstanding principal exceeding £25,000 on foot of charges under that subsection.

Equitable interests.

[1947, s. 40.]

40. —(1) A priority charge on registered land which is not a permanent improvement charge on the land shall as between the mortgagor and equitable claimants (other than the mortgagor) against the land be deemed to be charged on all and every (if any) estate and interest in the land to which the mortgagor was at the date of the registration of the priority charge or becomes at any time thereafter beneficially entitled in indemnification of all equitable claims against the land by equitable claimants other than the mortgagor.

(2) Money paid to the Corporation by, or out of the share, estate or interest of, an equitable claimant (other than the mortgagor) on foot of a priority charge on registered land which is not a permanent improvement charge on the land shall be repaid to the equitable claimant by the mortgagor on demand with interest thereon at the rate applicable to the charge and until so repaid the money and interest thereon shall be a debt due by the mortgagor to the equitable claimant and shall be deemed to be charged in favour of the equitable claimant on all and every (if any) estate and interest to which the mortgagor is beneficially entitled in the land or the proceeds of the sale thereof at the date of payment to the Corporation.

Protection of minors and persons of unsound mind.

[1947, s. 41.]

41. —(1) Where registered land is subject to a priority charge which is not a permanent improvement charge and an equitable claimant against the land is, at the date of registration of the priority charge, under the age of twenty-one years or of unsound mind, the equitable claimant shall be entitled at any time after registration (but, in case he is under the age of twenty-one years at the time of the registration, not after he attains the age of twenty-five years) to obtain from the Circuit Court an order that the mortgagor shall, by giving security, lodgment of money in Court or such other means as shall be approved of by the Court, give to the equitable claimant an indemnity which in the opinion of the Court adequately protects his equitable claim against the priority charge and that in default of the mortgagor giving such indemnity within three months after the date of the order the registered land be sold by the Court and the proceeds of sale be applied according to law and that in any event the costs of the equitable claimant in relation to the order, the application therefor and all proceedings thereunder when taxed as between solicitor and client be paid by the mortgagor.

(2) An indemnity given by a mortgagor in pursuance of subsection (1) shall be enforceable, with the leave of the Circuit Court and in such manner as that Court directs, whenever the priority charge in respect of which the indemnity was given is enforced to the prejudice of the equitable claim for the protection of which the indemnity was given or in such other circumstances as in the opinion of the Court render it just and equitable that the indemnity should be enforced.

(3) The rights and benefits conferred on any equitable claimant by this section shall be in addition and without prejudice to any other rights or benefits to which he may be entitled under this Act.

(4) No order under subsection (1) shall be granted without notice to the mortgagor unless the Court thinks proper to dispense with notice.